American economic growth in historical perspective - What were the drivers of US economic growth in the long run ?
- What were the drivers of US economic growth in the long run?
- Climate and natural resources of land
- The culture
- Constantly increasing productivity
- The link between the growth in the US and the institutions
If one could describe the American economy in a phrase, it would be ?The modern American economy'. This is the popular terminology that will be used to describe the American economy. This status achieved by America is the result of a process that started a long time ago. In the 16th, 17th and 18th centuries, settlers not only came into the New World for economic gains (gold) but also for achieving honor and glory. Initially, the New World was regarded as the marginally successful colonial economy. Since this stage, it has grown amazingly into a small and independent economy and has eventually progressed to become a highly complex industrial economy. Today, all credit is given to economic growth and the standard of living in the United States has improved nearly five times from what it was towards the end of the 19th century. Economic growth is a positive change. In other words, there is a comparative increase in the level of production of goods and services by a country and the responsibility and accountability arises for a growing standard of living over a certain period of time. It occurs especially when there is a rise in the per capita real GDP. In the long run, economic growth is a product of increasing quantity and increasing quality in the factors of production in the economy. This is possible due to the four main drivers i.e. geography, culture, productivity and institutions.